More than 4.5 million Fios TV customers will still be able to watch ESPN, ABC and other Walt Disney-owned channels after Verizon and Disney struck a last-minute deal.
The companies announced Sunday that they had “reached a broad-based distribution agreement,” ending a high-stakes dispute over programming fees that threatened to drop Disney’s programming from the Fios TV network. The two sides were facing a deadline of 5 p.m. on Dec. 31.
The spat was particularly worrisome for football fans, as ESPN and ABC are set to air college football games on New Year’s Day and one of the NFL wild-card playoff games on either Jan. 5 or Jan. 6.
The agreement means Fios TV can continue airing Disney-owned networks, which include ESPN, Disney Channel, and ABC affiliates in Philadelphia and New York. The companies said details of the agreement would be released in the coming days.
The dispute became public last week when Disney began running ads Wednesday warning Fios customers of the potential blackout. Verizon later emailed customers saying Disney had rejected its offers.
It was the latest clash between content providers and distributors over programming fees. Content makers typically ask distributors to pay more to carry their TV channels, while distributors try to keep costs low to compete with cheaper online streaming options such as Netflix, Hulu, and Sling TV.
At about $8.14 a month per subscriber, industry analysts say, ESPN is one of the most expensive channels that distributors carry, compared with roughly $1 for the average channel.
In 2018, there have been 137 such blackouts, according to a tally kept by the American Television Alliance, which represents the interests of such content distributors as Verizon, Spectrum, Dish, and CenturyLink.
Verizon told customers that Disney wanted hundreds of millions of dollars more for its programming and demanded that Verizon include ACC Network, a regional sports channel, in order to carry other Disney-owned channels.
The dispute comes at a time when Disney is preparing to launch its own direct-to-consumer streaming service in 2019. Disney already offers a sports streaming service called ESPN+ that costs $4.99 a month.